A Mini Guide to Home Insurance

Posted by akanshasingh on January 27th, 2017

Home Insurance helps you secure your house from the perils of natural disasters and treats. Home insurance in India is gaining popularity as many people have become the victim of natural disaster where they ended up losing their houses and in turn their lifelong investments. It is indeed a blow if all of sudden your house is at risk and you do not have enough capital to reinstate the damages.

A good home insurance plan provides coverage for the following:

Damage to the structure of the house due to natural calamities or fire break-out

Loss to content and valuables of the house

General features of Home Insurance

Coverage for fire, theft, explosion, burglary, natural disasters and contents of the house

Coverage towards jewels and gems, if required

Coverage towards electronic devices, if required

Covers damage to the house periphery

Flexible option of premium payment on monthly or annual basis

Online purchase option to save time and effort

Installation of safety devices like theft alarm, smoke alarm and any other such devices help in availing discounts on premium

Insurance is extended on rented and owned properties

Getting home insurance quote

Home Insurance quote depends upon various factors:

Rented or owned accommodation

Type of property: flat or individual house

Property age

Coverage type: structure or content or both

Determining coverage amount

Coverage amount is the maximum limit that would be paid if some damage occurs to the house. The major factor that determines the coverage amount is reconstruction cost of the house. Reconstruction cost is ascertained by the following formula:

Total constructed area*Construction cost per square feet

Many people assume that cost of the house is taken into consideration while calculating the coverage amount. However, this is entirely a wrong assumption. The market value of the house may be much more than the reconstruction cost of the house and it is not beneficial in evaluating the loss to the structure. The insurance aims to cover the damages/loss and not to provide profit to the insurer.

Going for Home Insurance is a prudent decision as your lifelong saving demands a robust protection. You can definitely rest at peace once you are sure that your shelter is safe. Hence, do not wait for a calamity to define your define your home insurance priorities but act now.

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